Dear Representative Hollingsworth:
With respect to the Conference of State Bank Supervisors (CSBS), 1 i will be composing to state our membersвЂ™ severe concerns with and opposition towards the Modernizing Credit Opportunities Act (H.R. 4439), which seeks to ascertain that the bank may be the вЂњtrue lenderвЂќ in almost any loan project arrangement having a third-party company. State regulators have window that is unique bank and non-bank lending relationships by virtue of these work chartering banking institutions, licensing non- bank lenders, and overseeing the conduct of both kinds of entities, including financing partnerships between your two. State regulators will also be the вЂњboots on the floor,вЂќ policing their areas to guard customers from harmful and exploitative lending options that run afoul of state guidelines.
State regulators are worried that H.R. 4439 could cause вЂњrent-a-charterвЂќ arrangements between banking institutions and lenders that are non-bank have already been created specifically to circumvent state usury and licensing regulations. Continue reading